To complete a UK VAT return, you pull the VAT figures from your sales and purchase records into Making Tax Digital compatible software, enter them across the nine boxes of the VAT100, and submit the return through the software to HMRC within one calendar month and seven days of your accounting period end. Boxes 1 to 5 hold the actual tax; Boxes 6 to 9 hold the net values of your sales and purchases excluding VAT. Payment is due by the same deadline as the return.
What to Have Ready Before You Start
Your nine-digit VAT registration number sits at the top of every return and links it to your HMRC account.1HM Revenue & Customs. HMRC Patterns for Services – VAT Registration Number The numbers themselves come from your sales invoices, purchase invoices, credit notes, and debit notes covering the accounting period.
Two extra items catch people out. If you import goods, you need your C79 import VAT certificates, which show the VAT paid at the border and support your claim to reclaim it as input tax.2GOV.UK. Check How to Get Your Import VAT Certificate (C79) If you provide company vehicles that employees also use privately, you need the current road fuel scale charge for the car’s CO2 band and your period length; the VAT element goes into Box 1.3GOV.UK. VAT Road Fuel Scale Charges From 1 May 2026 to 30 April 2027 Where the CO2 figure is not a multiple of five, round it down.
Keep the underlying records for at least six years. Businesses using the VAT One Stop Shop scheme keep records for ten years.4GOV.UK. Charge, Reclaim and Record VAT: Keeping VAT Records
Filing Through Making Tax Digital
Since April 2022, every VAT-registered business has to keep VAT records digitally and submit the return through compatible software rather than typing figures into HMRC’s online portal.5HM Revenue & Customs. VAT Notice 700/22: Making Tax Digital for VAT The only exception is businesses that have been granted a digital exclusion exemption, which lets them use the portal.6ICAEW. MTD and VAT
The rule that trips people up isn’t the software itself but the digital link requirement. Once data lands in your system, every onward transfer of that data has to happen through a digital link: linked spreadsheet cells, CSV or XML imports and exports, or API transfers between packages. Copy-and-paste, retyping figures, and screenshots do not count. Your Box totals can be perfectly accurate and the return still fail this test.
Boxes 1 to 5: The VAT Calculation
Boxes 1 to 5 report the tax itself.7HM Revenue & Customs. How to Fill In and Submit Your VAT Return (VAT Notice 700/12)
Box 1 is the VAT due on all your sales and other outputs for the period, covering standard-rated, reduced-rated, and zero-rated supplies. It also picks up VAT on goods taken out of the business for personal use and the VAT element of any fuel scale charges.
Box 2 is the VAT due on acquisitions of goods brought into Northern Ireland from EU member states under the Windsor Framework. If your business operates entirely in Great Britain and no goods move through Northern Ireland, this box is zero.
Box 3 is Box 1 plus Box 2. Your software fills it in automatically.
Box 4 is the input tax you can reclaim: VAT on business purchases, expenses, and overheads, plus any import VAT accounted for through postponed VAT accounting, plus the same acquisition VAT you entered in Box 2 (you both owe it and reclaim it).
Box 5 is Box 3 minus Box 4. A positive figure is what you owe HMRC. A negative figure is a repayment due to you. Businesses that export heavily or make large capital purchases often sit in repayment.
Boxes 6 to 9: The Net Values
The final four boxes report values excluding VAT.7HM Revenue & Customs. How to Fill In and Submit Your VAT Return (VAT Notice 700/12)
Box 6 is the total value of your sales and other outputs for the period, excluding VAT.
Box 7 is the total value of your purchases and other inputs, excluding VAT.
Box 8 applies only to goods supplied from Northern Ireland to EU member states. Enter the total value of those goods along with directly related costs such as freight or insurance, excluding VAT. A dispatch from Northern Ireland to an EU destination goes here even without a sale.
Box 9 is the reverse: the total value of goods acquired from EU member states into Northern Ireland, excluding VAT.
Construction Domestic Reverse Charge
If you buy or sell construction services within the domestic reverse charge, the box treatment shifts. As the contractor receiving reverse-charge services, you put the output tax in Box 1 and reclaim the same figure in Box 4, with the net purchase value in Box 7. As the subcontractor making reverse-charge supplies, the sale value goes in Box 6 but Box 1 stays empty for those transactions, because the customer accounts for the VAT. Getting this backwards is a common source of construction-sector errors.
Submitting the Return and Paying
The filing deadline is one calendar month and seven days after the end of your accounting period.8GOV.UK. Sending a VAT Return Quarterly filers meet four of these deadlines a year. Your software transmits the return through its API connection to HMRC, and the response includes an electronic receipt worth keeping.
Payment is due on the same date. A Direct Debit pulls the funds automatically three working days after the submission deadline, which gives you slightly longer than pushing the payment yourself. Faster Payments and Bacs also work, but cleared funds have to reach HMRC by the deadline.9HM Revenue & Customs. VAT Payments on Account When the deadline lands on a weekend or bank holiday, a Faster Payment on the next working day is accepted; other methods have to clear before the weekend.
Where HMRC owes you a repayment, they aim to process it within 30 days. Delays beyond that attract repayment interest, currently 2.75% as of January 2026, calculated as the Bank of England base rate minus 1% with a 0.5% floor.10GOV.UK. HMRC Interest Rates for Late and Early Payments
Fixing an Error After You’ve Filed
You can correct errors on returns going back four years from the end of the affected accounting period. Deliberate inaccuracies have a 20-year window.11HMRC Internal Manual. Error Correction for VAT Returns: Time Limits: Introduction How you report the correction depends on its size.
- Under £10,000 net: adjust the figures on your next VAT return. No separate notice required.
- £10,000 to £50,000 net, and under 1% of your Box 6 figure: still eligible to adjust on the next return.
- Over £50,000, or £10,000 to £50,000 where the error exceeds 1% of Box 6: notify HMRC separately, typically on Form VAT652, giving the affected period, a description of the mistake, the correct figure, the net difference, and how the error arose.
- Any deliberate error, regardless of size: must always be disclosed separately.
To adjust a small error on the current return, add underdeclared tax to Box 1 (or reduce Box 4) if you underpaid, or reduce Box 1 (or increase Box 4) if you overpaid. The change flows through to Box 5 with your normal payment or repayment.
Penalties for Late or Wrong Returns
Late returns run on a points-based system. Each late return earns one point, and once you hit the threshold for your filing frequency you receive a £200 penalty, with another £200 for every further late return while you stay at the threshold.12HM Revenue & Customs. Penalty Points and Penalties if You Submit Your VAT Return Late The threshold is four points for quarterly filers, five for monthly, and two for annual.13HM Revenue & Customs. Penalties for Late Submission A run of compliant filing clears points off the record.
Inaccuracy penalties sit under Schedule 24 of the Finance Act 2007 and scale with behaviour.14Legislation.gov.uk. Finance Act 2007 – Schedule 24 A genuine mistake made with reasonable care carries no penalty. A careless error attracts up to 30% of the understated tax. Deliberate errors run higher, and deliberate concealment can reach 100% of the tax owed.15HM Revenue & Customs. Compliance Handbook – CH401050 – Charging Penalties: Introduction: Overview Telling HMRC about an error before they find it substantially reduces those percentages.